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The Implications of Congressional Stalling on the COVID-19 Relief Package

September 10, 2020

By: Lindsay Burrows

White House leaders and Congress are currently negotiating the next COVID-19 emergency supplemental package following the release of a series of COVID-19 emergency relief bills, referred to as the Health Education and Liability Protection and Schools (“HEALS”) Act. This relief package includes approximately $1 trillion in spending to support recovery from the COVID-19 pandemic.

The Trump Administration and Congressional Democrats have yet to agree on the terms of this relief package. As the HEALS Act stalls, the healthcare industry and various healthcare policies remain at stake.

COVID-19 has gravely impacted the financial state of healthcare systems across the nation.

To assist healthcare providers respond to the pandemic, Congress initially passed the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act, which set aside $175 billion dollars in relief funds to eligible healthcare providers. To date, the CARES Act has only authorized the use of $100 billion in relief funds, which was based on the provider’s Medicare Fee-for-Service reimbursements, as reflected on the provider’s cost reports.

Since Congress’ disbursement of the CARES Act funds in late March 2020, healthcare costs have continued to increase. Furthermore, previously disbursed CARES Act funds are now running low or virtually non-existent. Therefore, there is much at stake for healthcare systems’ bottom line.  While Congress has acknowledged that providers are in need of additional coronavirus relief funding, there is no telling when the next relief package will be rolled out. 

On top of already tight margins and a lack of additional healthcare funding, providers were set to begin repaying Medicare loans in August 2020,  which were given for COVID-19 assistance.  With limited incoming revenue, providers are bound to struggle with loan repayment. Further augmenting the need for financial relief, the Centers for Medicare and Medicaid Services (“CMS”) spent some time deliberating whether providers would be restricted from receiving Medicare Fee-for-Service reimbursement until their Medicare loans are repaid. Luckily, CMS clarified that repayment conditions will be relaxed due to the current financial state of healthcare systems, and that providers would not ultimately be penalized in future Medicare payments.

The proposed extension of telehealth payment flexibilities, which were introduced by the CARES Act, will also be impacted by Congressional stalling on the pending COVID-19 relief package. Without a COVID-19 relief package, the telehealth payment flexibility policies will remain tied to the Department of Health and Human Services’ public health emergency declaration, which must be renewed every 90 days. Essentially, providers rendering telehealth services will have to closely monitor the payment policies every 90 days for potential changes.

COVID-19 testing funds are pending due to the current negotiations regarding the HEALS Act.  Insurance companies have requested that Congress make a fund to cover coronavirus testing for public health purposes, back-to-work, back-to-school, and for other circumstances in which insurance companies are not required to provide coverage. Such funding is quite necessary considering the current state of the pandemic.

In light of the continued prevalence of coronavirus cases in the United States, it would be in the best interest of the nation if the Trump Administration and Democratic Congressional leaders could come to an agreement on this important relief package.